After reports that three foreign investors (FPIs), who had made large investments in Adani Group's companies, were frozen, Adani Group's shares plummeted Monday.
This effectively wipes out $6 billion of Gautam Adani's wealth as chairman of the Group, which Adani had become just days before he became Asia's second-richest man, following Mukesh Ambani, Chairman at Reliance Industries.
Adani's increase in net worth was driven by a remarkable rise in the market capitalization of Adani Group Companies, led by a sharp uptake in share prices of its listed businesses.
Bloomberg Analysis last week revealed that Adani's net worth has increased to $43 billion. This will bring him up to $77 Billion by 2021. Analysts were puzzled by the dramatic increase in shares of these stocks and wondered if they were overvalued.
However, Adani Group's stock price movement will determine how much the market capitalization of its companies changes. The projected wealth, the gains or losses, and the potential wealth are only estimates until Adani sells these shares to record profits or losses.
Adani's net wealth fell to $6 billion Monday. That's a decrease of $71billion from $77billion the week before. The stocks of both companies rebounded Tuesday and recouped some of its notional losses. Adani now has a net worth of $73billion.
This was after, the company, informed the stock markets that the accounts of FPIs had not been frozen. According to communication it received from the National Securities Depository Limited NSDL, a securities clearing house body, this information was made.
Despite the decline in share prices Adani still remains the second most wealthy Asian after Ambani, according to the Bloomberg Billionaires Index.
Ambani has seen his net worth increase significantly over the past year. Reliance Industries' share value surged due to massive foreign direct investments into Jio Platforms which is a subsidiary of Reliance Industries.
Bloomberg data shows Ambani increased his net worth by $30 billion in the past year, bringing his total worth to more than $86 billion.
Reliance Industries share price increased 110 percent from April 2020. This brought its market capitalization at Rs 14.26 lakh crore. According to the Bombay Stock Exchange website, Mukesh Ambani, the promoter group, holds 50.58% of the company’s shares.
